Facts:
Julie Nabus, Michelle Nabus and Betty Tolero were defendants in a suit filed by
Joaquin Pacson and Julia Pacson concerning an allegedly conflicting conveyance of land situate in Pico, La Trinidad, Benguet originally titled under TCT No. T-9697 in the names of the Spouses Bate and Julie Nabus and mortgaged to the Philippine National Bank. On February 19, 1977 the Spouses Nabus executed a
Deed of Conditional Sale covering 1,000 square meters in favor of the Pacsons for P170,000 with a payment scheme that required payment to the bank and later full payment before the vendor would execute transfer documents; the Pacsons paid various amounts to the Nabus and the bank from 1977 to 1984, producing 364 receipts totalling P112,455.16 and leaving a balance shown as P57,544.84. On March 5, 1984 Julie and Michelle Nabus executed a
Deed of Absolute Sale in favor of Betty Tolero covering the whole parcel and new transfer certificates of title were issued in Tolero’s name for the subdivided lots, following which Tolero took possession and padlocked the Pacsons’ repair shop; Catalina Pacson discovered the new titles and the Pacsons filed a complaint in the Regional Trial Court (docketed as Civil Case No. 84-CV-0079) seeking annulment of the extrajudicial settlement insofar as it affected the Pacsons’ rights, annulment of TCT No. T-17718 and the Deed of Absolute Sale to Tolero, damages and injunctive relief. The trial court rendered judgment on September 30, 1993 in favor of the Pacsons ordering Tolero to execute a deed of absolute sale in their favor upon payment of the balance (P57,544.84) and awarding moral, exemplary damages and attorney’s fees; the Court of Appeals affirmed with modification on November 28, 2003 deleting the attorney’s fees, and the present petition followed to the Supreme Court which rendered judgment on November 25, 2009.
Issues:
Was the
Deed of Conditional Sale between the Spouses Nabus and the Spouses Pacson converted into a contract of lease?; and Was the Deed of Conditional Sale a
contract to sell or a
contract of sale such that the Pacsons could compel conveyance despite their unpaid balance?
Ruling:
Ratio:
Doctrine: